Preparation of Contract Briefs are often a forgotten and generally disregarded tool of contract management that can prove very useful in improving cash flow through compliant billings and ensuring compliance with contract terms and conditions.
What are they?
A sample Contract Brief is defined as Supplemental Schedule O as part of the suggested schedules to be included in the Incurred Cost Proposal required by FAR 52.216-7, Allowable Cost and Payment, can be found at Enclosure 6 of the DCAA Manual No. 7641.90, Information for Contractors, on the DCAA website. It is also included as part of the Incurred Cost Electronically (ICE) Model at http://www.dcaa.mil/Home/ICEmodel.
The Contract Brief generally incudes: a synopsis of all pertinent contract provisions; identification of the cognizant ACO and/or PCO and DCAA Office; where progress payments and vouchers should be submitted; billing instructions (e.g., CLIN level, period of performance, etc.); applicable FAR and DFARS (or other Agency) contract clauses incorporated; special contract requirements relative to such things as overtime, travel, labor qualifications; and any waivers to specific regulations.
They also include information on contract funding; ceilings on rates or costs; and fees, as required for compliance with FAR 52.232-20, Limitation of Cost, and FAR 52.232-22, Limitation of Funds, clauses. Additional information may also include a brief statement of work, specific reporting requirements, subcontract information and a running total of the initial contract value and all contract modifications.
Why are they important?
Once a contract is signed the contractor is expected to fully comply with all terms and conditions included in the contract. Without this full understanding as to what is agreed to in the contract, contractual issues can occur throughout the life of the contract. A contract brief should not only be prepared once the contract is signed, but throughout the contract negotiation process to ensure you know and understand what you are agreeing to up-front.
The briefs are also useful in disseminating pertinent contract information to contract administrators, program managers, accounting and billing personnel and government auditors (i.e. DCAA).
There is no better way to perform your complete review of the terms and conditions but, through a thorough review of the proposal and the contract, and to write them down as the brief. Many ERP software programs provide for input of the financial data but non-financial terms and conditions will need to be documented through preparation of the brief. Take the time to prepare contract briefs. Your time and effort will pay-off in the long run.